Voters to decide utility bond issue today

Voters in Carthage have a chance today to allow the city-owned utility to pay for needed upgrades to the wastewater treatment plant using low-interest financing, saving rate-payers money in the future.

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By John Hacker

The Carthage Press

By John Hacker

Posted Aug. 5, 2014 at 9:36 AM

By John Hacker
Posted Aug. 5, 2014 at 9:36 AM

Voters in Carthage have a chance today to allow the city-owned utility to pay for needed upgrades to the wastewater treatment plant using low-interest financing, saving rate-payers money in the future.

Carthage Water & Electric Plant General Manager Bob Williams said the utility will eventually have to upgrade the plant to meet new federal mandates that would require lower levels of ammonia and other pollutants to be discharged into the Spring River, and the utility has a unique chance to cash in on special financing.

Williams said CW&EP plans to seek grant funding from the Spring River watershed improvement initiative to pay for pas much as half of the $6 million cost for the improvements, then finance much of the rest through the Missouri Department of Natural Resources State Revolving Fund, which will finance improvements such as this at a much lower interest rate.

Williams said the utility needs voter approval to finance the project with the State Revolving Fund.

“That's why we're trying to do this now,” Williams said. “State money is available through grants so we could get as much as $3 million through those grants. The State Revolving Fund charges an interest rate of about 2 percent as opposed to 4 percent if we sought privately financing."

Dean Willis, with Algeier Martin and Assoc., the engineer that is designing the upgrades, told the Carthage City Council's budget committee in May that grants to protect the Spring River may only be available for another two years, but could relieve Carthage rate payers of half the cost of the upgrade if the utility taps into them.

Williams said paying off the loans will not require a rate hike because the loans will kick in at about the same time as CW&EP finishes paying off millions in loans it took out in 1996 to pay for the water towers on Francis Street and at the Fair Acres land, freeing up the money that was being used to pay those loans to be used for the new ones.

“There will be no new debt service created,” Williams said. “When one goes away, the new one comes on, so it's basically a wash. The only rate increase may be, as time goes on, the added operations cost of the new equipment, but there will be no immediate rate increase associated with this proposal.”